It turns out that Application Data is not a real directory but is what is known as a junction point that just points back to c:\programdata. When the Windows 10 update is run, this junction point is deleted. The way around the problem is to do the following:

Run Notepad or your favourite text editor as Administrator.

Open IBCONFIG. This is located in the InterBase installation directory

Locate the APPDATA_DIRECTORY setting.

Change this to APPDATA_DIRECTORY "C:\ProgramData\Embarcadero\InterBase\<instance name>"